This weekly roundup analytically summarizes the key stories related to the Supreme Court and High Court reported at Taxscan.in from September 14th, 2024, to September 20th, 2024.
The Supreme Court observed that as per sub-section (4) thereof every proceeding under sub-sections (2) and (3) is deemed to be a Judicial proceeding within the meaning of Section 193 and Section 228 of the Indian Penal Code,1860. Also according to sub-section(4) of Section 63, a person who intentionally disobeys any direction issued under Section 50 of Prevention of Money Laundering Act, 2002 ( PMLA,2002 ) is liable to be proceeded against under Section 174 of Indian Penal Code,1908.
Since the said Complaint is pending before the concerned Court of Chief Judicial Magistrate, the court does not express any opinion on the merits of the said Complaint. Suffice to say that the court finds no illegality in the said orders passed by the concerned court and that the said complaint shall be proceeded further by the said Court in accordance with law. For the reasons stated above, both the Appeals being devoid of merits are dismissed.
In a significant relief to Ericsson India Private Limited, the Supreme Court of India has upheld the deletion of the penalty imposed under Section 271G of the Income Tax Act, 1961. The penalty, which was earlier imposed by the tax authorities for failure to provide necessary documentation related to international transactions, was removed by the Delhi High Court, and the Supreme Court has now confirmed that ruling.
In this case, Ericsson India was initially penalized by the income tax department for non-compliance. However, both the Delhi High Court and the Supreme Court found that the conditions necessary to impose the penalty under Section 271G were not met. The Supreme Court’s decision reinforces the importance of procedural fairness in imposing penalties under the Income Tax Act, especially when it comes to transfer pricing requirements.
In a recent ruling, the Supreme Court granted bail to the assessee who got arrested for Goods and Services Tax ( GST ) fraud considering the lengthy incarceration and no direct documentary proof connecting to the assessee.
The Court allowed the bail petition, ordering the petitioner’s release on furnishing bail bonds amounting to Rs. 1,00,000 with sureties of the same amount and imposed serval other conditions.
Consequently, the Special Leave Petition was allowed, and any pending applications related to the case were disposed of.
The Supreme Court has recently dismissed a Special Leave Petition (SLP) filed by the Commissioner of Income Tax (International Taxation), Income Tax Department against taxability of payments received in lieu of computer software access to member firms.
It was noted by the Delhi High Court that such payments do not result in income taxable in India, and the persons referred to in Section 195 of the Income Tax Act are not liable to deduct any Tax Deducted at Source (TDS) under that section. Earlier in April, the Supreme Court had also held that Licensing of software products of Microsoft in Territory of India is not taxable in India, in a similar case.
In a recent judgment, the Calcutta High Court dismissed a review petition filed by the State GST authorities in connection with the non-updation of Part B of an e-waybill. Thus, the request of imposing penalty was rejected and directed to release the bank guarantee.
The court held that no grounds for interference were established, and the review petition was dismissed. The connected application was similarly dismissed. Furthermore, the court ordered the immediate release of the bank guarantee dated 5th August, 2023, held by the State respondents, directing that it be returned to the petitioners.
A fresh opportunity to establish the authenticity of the income tax audit report was granted to the assessee by the Karnataka High Court. The court set aside the order of the Assessing Officer rejecting the tax audit report submitted by a Chartered Accountant ( CA ) on ground that the schedule and the annexures were not signed by the CA firm partner.
Considering the contention of the petitioner that additional documentation could verify the authenticity of the Tax Audit Report, the Court set aside the impugned order. The petitioner was granted liberty to present additional evidence, which must be considered by the Assessing Officer in accordance with the law.
The Karnataka High Court has directed a stay on penalty orders and demand notices issued by the Income Tax Department, stating that the Section 275 of Income Tax Act, 1961 clearly bars the issuance of penalty orders while the appeals are pending.
The high court, upon reviewing the provisions of Section 275 and the case law of B.S. Uday Shetty vs. The Assistant Commissioner of Income Tax, agreed with the petitioner. The court ruled that the penalty orders and demand notices should be kept in abeyance until the appeals are disposed of.
In a matter of dispute over the payment source of 10% pre-deposit for filing GST ( Goods and Services Tax ) appeal from the Electronic Credit ledger ( ECRL ) or Electronic Cash Ledger ( ECL ), the Patna High Court, set asiding the order rejecting appeal, ordered the appellate authority to consider the case on merits.
As the petitioner had already paid the 10% pre-deposit from the Electronic Credit Ledger, the court ruled that the appeal was maintainable and directed the Appellate Authority to review the case on its merits. The appeal was allowed.
The Madras High Court has ordered the issuance of a fresh Show Cause Notice ( SCN ) under Section 148 of the Income Tax Act to address new issues that were not covered in the original notice. The department was asked to provide a fresh order under Section 148A (d) after regarding the reply of the taxpayer.
The Madras High Court after regarding the submissions of both sides held in favor of the applicant. The same has been quashed in the impugned order. It asked the first respondent to provide a new order under Section 148A(b) of the Income Tax Act, furnishing the applicant with a reasonable chance to respond within a maximum period of 3 months from the date of receipt of the order of the court. To ensure the timely completion of the aforesaid practice the applicant was asked to extend the full cooperation.
In a recent ruling, the Karnataka High Court has directed the GST ( Goods and Services Tax ) Department to restore a petitioner’s GST registration within four weeks, following an unjust cancellation. The court noted that the department committed a factual error.
The court noted that this error warranted setting aside the cancellation order and reinstating the GST registration. Consequently, the High Court directed the GST registration be restored within four weeks, provided the petitioner files all pending returns and pays any due taxes.
In a recent ruling, the Madras High Court quashed the reopening of the assessment order under Section 148, stating that it was based on a grossly erroneous factual foundation, rendering it untenable in law.
As a result, the court quashed the impugned order and notices, rendering the subsequent assessment orders void. The ruling underscores the necessity for accurate factual bases and proper procedural adherence in reassessment proceedings.
The Karnataka High Court has declared that issuing a single consolidated Show Cause Notice (SCN) under Section 73 of the Goods and Services Tax ( GST ) Act for multiple assessment years is unlawful. According to the court, the consolidated SCN issued by the GST department was fundamentally flawed. It also stated that such notices contravened the GST Act and the legal precedents.
The bench observed that the practice of issuing a single, consolidated show cause notice for multiple assessment years contravenes the provisions of the CGST Act and established legal precedents. The Karnataka High Court thus ruled that the consolidated SCNs were fundamentally flawed. It ordered the quashing of the notices and affirmed that separate SCNs must be issued for each assessment year in compliance with the GST Act.
In a recent ruling, the Madras High Court set aside the Income Tax assessment order which was passed hastily without considering the taxpayer’s submission amidst the approaching deadline.
The court noted that the explanation submitted by the petitioner on 29.09.2021 was not adequately considered in the assessment order. Therefore, the court set aside the impugned assessment order dated 30.09.2021 and directed the assessing officer to pass a new assessment order within six months, following due process and allowing the petitioner to present its case. Thus, the petitioner’s writ petition was disposed of without any order as to costs.
The Madras High Court ruled that the transferor’s unfulfilled obligations under an advance license, including liabilities related to customs duty, persist post-merger and are not extinguished, further holding that these obligations are transferred to and must be discharged by the transferee in cases of merger or amalgamation.
The court dismissed the writ petition and directed the petitioner to respond to the show cause notice within 30 days. A corrigendum to the notice would be issued, addressing the petitioner as the successor company. The respondents were instructed to adjudicate the matter within three months and complete the process within six months. Should the petitioner fail to cooperate, the respondents may confirm the demand and proceed with recovery. The petition was dismissed without costs, and all related miscellaneous petitions were closed.
In a recent ruling, the Karnataka High Court has ruled that a minimum seven-day response period shall be granted mandatorily for the notices issued under Section 148A(b) of the Income Tax Act, 1961.
Justice S. Suni Dutt Yadav agreed with the petitioner’s argument, finding that the inadequate response time violated the principles of natural justice and caused prejudice. Consequently, the court declared the notices issued under Section 148A(b) as well as the subsequent orders and penalty notices, to be invalid. Consequently, the notices and orders in question were set aside, with the court granting the Revenue the liberty to issue new notices and take appropriate action in accordance with the law.
In a recent ruling, the Madras High Court ruled that reopening assessment under Section 148 of the Income Tax Act, 1961 within the time limit cannot be interfered with if there was an escapement of income.
The court acknowledged that reopening was initiated before the lapse of four years, and there was no scope for interference with the Income Tax authorities’ reopening decision if escapement income was found. Therefore, the court dismissed the writ petition and granted liberty to the petitioner to raise all objections before the Assessing Officer during the reassessment process.
In a recent ruling, the Madras High Court ruled that the Central Value Added Tax ( CENVAT ) Credit was permissible for electricity supplied to sister units from captive power plants under the CENVAT Credit Rules ( CCR ) ( Amendment ), 2011.
The Court acknowledged that wheeling electricity through TANGEDCO ensures transparency in the transfer process, and there is no inflated claim or misuse of the credit system. Therefore, the appellant’s eligibility for CENVAT credit for the coal used in electricity generation, even when wheeled to sister units, was upheld. The appeal of the appellant was allowed, and no order was passed as to costs.
The Bombay High Court has ruled that tax proceedings related to periods before the commencement of the Corporate Insolvency Resolution Process ( CIRP ) are extinguished once a resolution plan is approved. This decision follows the Assessee’s transition to new ownership and management under the CIRP.
Moreover, the Court dismissed the Revenue’s claim that the tax amounts, not having crystallised yet, should be considered future dues, stating that they were, in fact, past dues. In conclusion, the Court stressed that no proceedings related to operations before the CIRP approval could be pursued after the approval of the resolution plan. The Bombay High Court thus quashed the tax proceedings, holding that since they predated the CIRP, they were extinguished, and the Assessee’s petition was allowed.
The Madras High Court has ruled that bank accounts cannot be freezed beyond the alleged amount involved in the financial frauds.
Despite this, the court frequently receives petitions to unfreeze accounts, mentioning the failure of investigation agencies to notify both account holders and the jurisdictional court as mandated by Section 102 of the Cr.P.C. and Section 106 of the BNSS Act. Therefore, the bench directed the fifth respondent bank to unfreeze the account but maintain a lien over ₹2,50,000/-. The petitioner was allowed to operate the account with the condition that it always retains a minimum balance of ₹2,50,000/-.
In a recent ruling, the Delhi High Court dismissed the appeals and denied the retrospective application of the amendment made to the Finance Act, 2022. In this case, the two appeals have been filed by the Principal Commissioner of Income Tax. The petitioner department has challenged the Tribunal’s view that disallowance under Section 14A of the Income Tax Act, 1961 should be limited to the extent of exempt income earned during the year.
The bench relied on the memorandum explaining the provisions of the Finance Bill, 2022 which states that “This amendment will take effect from 1st April, 2022, and will accordingly apply in relation to the assessment year 2022-23 and subsequent assessment years.”. Thus, the Delhi High Court bench consisting of Justice Yashwant Varma and Justice Ravinder Dudeja dismissed the appeals and rejected the retrospective application of the 2022 amendment.
The Madras High Court has set aside the assessment order due to the Goods and Service Tax, the show cause notice and the assessment order were sent to the outdated address, while only the recovery notice was sent to the updated address. This lack of proper notice and failure to provide a personal hearing constituted a violation of natural justice.
The Court set aside the impugned order dated 21.09.2022. The petitioner is directed to submit their reply/objection along with necessary documents within two weeks. The respondent must then consider the reply and issue a 14-day clear notice for a personal hearing. The respondent will pass appropriate orders on merits and in accordance with the law after hearing the petitioner. The Writ Petition was allowed with no order as to costs. The connected miscellaneous petitions were closed.
In a recent hearing, the Karnataka High Court set aside an assessment order passed on relying on stock exchange and band information without providing hearing opportunity for the assessee.
The court found that the information procured from the Stock Exchange and Banks had not been shared with the petitioner, which violated the natural justice principles. The court agreed with the petitioner that the Income Declaration Scheme should have been considered, and its omission vitiated the impugned orders. Therefore, the court set aside the order and remanded the case for fresh adjudication. The petitioner’s petition was allowed
The Bombay High Court (HC), in a recent ruling, rejected the affidavit produced by the Customs Officer. The Bombay HC was satisfied that the respondent Surgive Mehra may not even have read the affidavit before signing it, as it begins by stating that he works as the Principal Commissioner in the Customs Commissionerate in Jodhpur (Preventive), Jaipur Headquarters, dated 27-08-2024.
The court held that Mr. Surgive Meena should affirm the copy and serve it by 20-09-2024. The court allowed the petitioner in this case to use the affidavit to show any contradiction in subsequent affidavits to be filed.
The Madras High Court quashed the income tax addition due to wrongful deduction under Section 194-IB instead of Section 194C of the Income Tax Act, 1961. The respondents proposed three additions to the declared income, but the additions were dismissed without adequate reasoning.
The court, finding the assessment order flawed, quashed it and remanded the case to the Assessing Officer for reconsideration, directing the officer to await the valuation report before proceeding. The writ petition was disposed of without any order as to costs, and the connected miscellaneous petitions were also closed.
In a recent ruling, the Karnataka High Court dismissed the revenue’s petition challenging the Income Tax Tribunal Appellate decision on Employee Stock Ownership Plan ( ESOP ) deduction, the court upheld that ESOP as a legitimate Business expense.
The Bench comprising Justice S. G. Pandit and Justice C.M. Poonacha heard the arguments of both sides. The court observed that the Tribunal’s ruling was based on the Biocon Ltd. case, which held that ESOP discounts are valid business expenditures under Section 37(1). Since the Tribunal followed a well-established legal precedent, no substantial question of law was involved. Thus, the court dismissed the Revenue’s appeal, upholding the ITAT’s order that allowed SAP India’s deduction for ESOP expenses.
The Madras High Court set aside the penalty order under Section 271E of the Income Tax Act, 1961, due to the Assessing Officer’s failure to record reasons for subjective satisfaction. The petitioner has filed writ petitions challenging the orders issued by the 1st Respondent under Section 271D of the Income Tax Act, 1961, dated April 29, 2024.
Considering the facts and the arguments presented, the Court determined that the impugned orders should be set aside. The matter was remanded to the 1st respondent, who is directed to issue a detailed, reasoned order, documenting the satisfaction for the penalty under Section 271D and addressing the petitioner’s reply and objections. The 1st Respondent is also instructed to provide an opportunity for a personal hearing. The writ petitions are thus disposed of, with no order as to costs. The connected miscellaneous petitions are also closed.
The Madras High Court has ordered the restoration of the GST registration for M/s. Chendur Film International, a film production company, which had its registration cancelled due to non-payment of taxes.
After considering the arguments, the high court decided to set aside the cancellation order. It directed that the GST registration be restored to enable the company to file all outstanding returns and remit statutory dues. The court stipulated that the restoration process should be completed within two weeks, and the petitioner must settle all returns and outstanding dues within eight weeks following the restoration.
In a recent ruling, the Karnataka High Court quashed the income tax assessment proceedings under section 148A (b) of the Income Tax Act, 1961 due to non-service of the show-cause notice.
Since the petitioner was not properly served with the notice, the court concluded that the petitioner was deprived of the opportunity to present their case and explain the source of the cash deposit. Thus, the court set aside the impugned notices and orders. The court restored the matter to the stage of the reply to the Section 148A(b) notice, allowing the petitioner an opportunity to explain the source of the cash deposit.
In the recent case, the High Court Of Calcutta, set aside the cancellation of GST registration due to non-filing of returns and directed the restoration of the registration, provided the petitioner filed all overdue returns and paid the necessary tax, interest, fines, and penalties.
A single bench of Judge Raja Basu Chowdhury directed the respondents to activate the portal within one week for the petitioner to file returns and pay dues, set aside the Appellate Authority’s order from 15th April 2024, and disposed of the writ petition.
In the recent case, the High Court of Madras condoned the delay in filing a GST appeal caused by septic shock. The petitioner, had cleared the entire tax liability but was unable to meet the appeal deadline due to medical complications
The court noted that the period of further delay in this case was only 24 days, and the petitioner had provided valid reasons to justify the delay. It was also observed that the petitioner had already paid the entire tax liability, and the proposed appeal was limited to contesting the penalty and interest. A single bench of Justice Senthilkumar Ramamoorthy directed the AA that if the appeal was submitted within ten days from the receipt of the order, it should be accepted and decided on its merits.
In a recent ruling, the Madras High Court dismissed the petition challenging the assessment order’s limitation period, stating that deemed assessment under section 22(4) of Tamil Nadu Value Added Tax Act ( TNVAT), 2006 can be issued if no VAT returns were filed and it should be considered the first assessment order.
Since no valid returns were filed, the court held that the first assessment was made in 2019. The limitation for reopening assessments under Section 27 of the TNVAT Act was not applicable until six years after the assessment, meaning the petitioner’s challenge to the orders had no merit. Hence, the writ petition of the petitioner was dismissed at no cost.
The Madras High Court has granted the petitioner an exemption from Countervailing Duty (CVD) on silk fabrics imported from China under Central Excise Notification No. 30/2004, in accordance with Section 149 of the Customs Act, 1962.
Justice Senthil Kumar Ramamoorthi, in disposing of the writ petition, instructed the respondent to review and resolve the petitioner’s amendment request dated April 29, 2023, as per Section 149 of the Customs Act, within six weeks, ensuring that the petitioner is provided with a reasonable opportunity to present their case.
In the recent case,the High Court of Madras called the cancellation of GST registration ‘capital punishment’ for traders. The court ordered the Goods and Services Tax ( GST ) department to simplify rules and send notices via SMS and in regional languages to better support small-scale entrepreneurs.
The court stated that the government’s goal is to promote trade, not to restrict it. The current practice of canceling registrations acts as a “capital punishment” for small-scale entrepreneurs, halting their business, affecting salaries, and damaging long-term progress. The GST department should relax rules, issue notices via SMS, and in regional languages.The court expects the GST department to amend provisions to consider these consequences.
A single bench of Justice B.Pugalendhi disposed of the writ petition.
In the recent ruling, the High Court of Karnataka, condoned a 2-hour, 38-minute 26 seconds delay in filing the Income Tax Return ( ITR ) due to genuine hardship and quashed the order issued under Section 119(2)(b) of the Income Tax Act,1961.
A single bench of Justice S.R. Krishna Kumar quashed both the order and the intimation, directed the respondents to condone the delay, and ordered the processing of the petitioner’s income tax return in accordance with the law, including the carry-forward of losses.
In a recent ruling, the Madras High Court upheld the Income Tax Appellate Tribunal’s (ITAT) decision that income derived from leasing out property in an IT park should be classified as business income, rather than income from house property.
Observing that there was no merit in the appeals filed by the Income Tax Department, the Court affirmed the tribunal’s ruling that the income in question should be taxed as business income. Consequently, the appeals were dismissed, and the substantial questions of law raised by the department were resolved in favor of the respondent.
Madras High Court, in a recent ruling, dismissed a writ petition challenging the transfer of an income tax case to the Central Circle in Kolkata, following the discovery of incriminating materials during a search and seizure operation.
Furthermore, the court determined that the petitioner’s objections regarding jurisdiction and financial hardship lacked merit, as the assessment needed to occur where the incriminating evidence was located. As a result, the writ petition was dismissed, affirming the transfer of the case to Kolkata.
The Delhi High Court has recently ruled that customs authorities cannot deny preferential duty rates or detain imported goods without forming a reasonable belief or opinion of forgery or non-compliance in import documentation. The court thus quashed detention orders against two companies importing platinum alloy sheets under the India-UAE Comprehensive Economic Partnership Agreement ( CEPA ).
This ruling reinforces the necessity for customs authorities to strictly adhere to statutory procedures when detaining goods or denying preferential duty rates under trade agreements like the India-UAE CEPA. Importers can expect that any verification of COO certificates or detention of goods must be based on well-substantiated grounds with proper application of mind by the authorities, as upheld by the Delhi High Court here.
The Rajasthan High Court has recently held that an assessee’s admission cannot be treated as conclusive evidence for income tax additions in the absence of corroborating material.
The judgement was delivered in the case of Principal Commissioner of Income Tax, Udaipur vs. M/s Esspal International Pvt. Ltd., marking an important precedent on the interpretation of Section 68 of the Income Tax Act, 1961.
In a recent ruling, the Delhi High Court held that the impugned action for income tax reassessment could be sustained.
The bench comprising of Justice Ravinder Dudeja and Justice Yashwant Varma allowed the writ petition and quashed the impugned order dated 19.07.2022 under Section 148-A(d) as well as consequential notice under Section 148 of the Income Tax Act, 1961.
The Delhi High Court in a recent ruling quashed the Goods and Services Tax ( GST ) cancellation order and restored registration for lack of compliance with natural justice.
The bench directed the respondents to restore the petitioner’s GST. registration. The bench further directed the petitioner to file his GST returns, which were due within thirty days, and also pay the tax along with interest and penalty. This the High Court bench comprising of Justice Vibhu Bakhru and Justice Sachin Datta allowed the present petition and set aside the impugned cancellation order and the SCN.
The Allahabad High Court quashed the recovery citation against the petitioner and held that the Liability for payment of motor vehicle tax cannot be imposed on the petitioner after the vehicle was taken by the financier.
The bench directed the petitioner to pay tax for the period prior, if not paid. The High Court bench comprising of Justice Shekhar B. Saraf and Justice Manjive Shukla, quashed the recovery citation against the petitioner.
In a recent ruling, the Madras High Court ruled that a single satisfaction note was sufficient under Section 153C of the Income Tax Act, 1961, when the same assessing officer handles both searched persons and other persons.
The court emphasized that the satisfaction note only needs to reflect a prima facie belief that the documents seized during the search related to the income of another person. The court found that the AO had sufficient reason to believe that the seized materials were related to the petitioners, based on the “J Pack” software entries and the statements recorded during the search. Therefore, the satisfaction note was validly recorded, even though the same Assessing Officer was involved for both the searched person and the petitioners. The court dismissed the petition and upheld the validity of the assessment orders.
In a significant ruling, the Delhi High Court has held that the Income Tax Department cannot deny a taxpayer’s refund claim merely because the Tax Deducted at Source ( TDS ) does not reflect in Form 26AS. The court quashed the department’s order rejecting the taxpayer’s application to file a revised return and directed that the refund be processed accordingly.
This ruling reassures that procedural lapses or administrative errors, such as non-reflection of TDS in Form 26AS, would not trouble taxpayers who have complied with their statutory and compliance obligations.
In a recent ruling, the Delhi High Court allowed M/S SS Enterprises a second opportunity to contest the cancellation of its GST registration, recognizing a violation of the principles of natural justice. The petitioner, SS Enterprises, challenged both the Show Cause Notice (SCN) issued on March 5, 2024, and the subsequent cancellation order dated April 2, 2024.
However, it did annul the rejection order dated May 1, 2024, for revocation of the cancellation, granting the petitioner an additional time of two weeks to respond to the allegations raised in the SCN dated April 19, 2024, for ensuring that due process is followed.
The Delhi High Court, recently issued a directive to restore the Goods and Services Tax (GST) registration of a petitioner for 30 days to allow them to file their outstanding returns.
Drawing from the precedent set in the TVL. Suguna Cutpiece Center case by the Madras High Court, the court observed that a taxpayer’s GST registration, vital for business operations, cannot be cancelled without providing a fair opportunity to rectify the issue. Consequently, the Delhi High Court restored the GST registration for the limited period, allowing the petitioner to file the necessary returns.
The proper officer was instructed to review the filings and decide on any further action, including the issuance of a fresh show cause notice if needed.
The Kerala High Court has overturned a denial of Input Tax Credit ( ITC ) under Section 16(4) of the Central Goods and Services Tax (CGST) Act, 2017 directing a reassessment in line with the principles established in the recent M. Trade Links case.
In a very similar case, the Kerala High Court issued a similar ruling in favour of Malamal Variamthody Manoj, Proprietor of Kairali Tradelink, Kozhikode, setting aside the denial of ITC on account of the provisions of Section 16(4) of the CGST/SGST Acts, directing the respondents to reconsider the petitioner’s claim in line with the court’s decision in M. Trade Links v. Union of India. Notably, the petitioner was represented by the same team of lawyers in this case.
A second provisional attachment order issued under Section 83 of GST ( Goods and Services Tax ) Act cannot be issued without providing fresh reasons, ruled the Allahabad High Court. Without proper justification, the attachment order is arbitrary. A writ petition challenging a provisional attachment order dated May 16, 2024. This order, issued under Section 83 of the CGST Act, targeted the same bank account that had previously been attached by an order dated February 16, 2023.
The bank was instructed to lift the attachment, allowing the petitioner access to their account. However, it was also clarified that the department have the liberty to proceed in accordance with law.
In a significant ruling, the Karnataka High Court has directed the refund of Rs. 17.48 crore, which was erroneously adjusted towards an Income Tax demand, along with interest.
Given that the stay order was issued before the adjustment of the refund, the adjustment was deemed illegal. As a result, the single bench of Justice Sunil Dutt Yadav directed the third respondent to refund ₹17, 48, 45,320 within eight weeks, along with applicable interest. The petition was thereby disposed of.
The Delhi High Court recently allowed a Petition seeking to quash an impugned reassessment order issued by the Income Tax Officer, Ward-63(1), Delhi against the Financials of the Petitioner Proprietary firm M/s. JMK Enterprises. The instant Writ Petition was filed against the Revenue alleging mishandling of the Petitioner’s Assessment for the Assessment Year 2014-15 by the Respondent Income Tax Officer.
On the basis of the findings and evaluation of law, the Delhi HC allowed the Petition while quashing the impugned reassessment order under Section 148-A(d) and the consequential Notice under Section 148 of the Income Tax Act, 1961 citing its overlap with the prior Notice and Assessment Order.
In a recent ruling, the Delhi High Court set aside the customs duty recovery proceedings initiated against a deceased individual.
The Delhi High Court bench observed that the SCN and the order in the original was passed against a dead person and there was a failure to include legal representatives. Thus the bench held that Order-in-Original confirming the demand of duty drawback amounting to Rs. 22,62,352 and penalty to be set aside. The bench comprising of Justice Ravinder Dudeja and Justice Yashwant Varma allowed the writ petition and quashed the recovery proceedings initiated against a dead person.
The Madras High Court has ruled that the Goods and Services Tax ( GST ) Department should thoroughly verify the correctness of tax returns before initiating action under Section 73 of the Tamil Nadu Goods and Services Tax ( TNGST ) Act, 2017. Thus, the court set aside the demand order.
The GST department was instructed to review the matter afresh, considering the petitioner’s additional submissions, and provide an opportunity for a personal hearing, ensuring that the decision was made based on the merits of the case and in accordance with the law. With these directions, the writ petition was disposed of, and the connected miscellaneous petitions were closed.
The Madras High Court ( HC ) in a recent case ruled that light green float glass ( tinted non-wired type ) shall be classified under tinted glass for duty purposes.
In result, the Court quashed the show cause notice issued by the Customs Department and directed the department to clear the goods under CTH 70051010, provided that the goods imported matched the description of “Light Green Float Glass (Tinted Non-Wired Type).” However, the Court declined to issue a declaration affirming the correctness of the classification, noting that such a declaration would require a detailed examination of the goods, which was beyond the scope of the writ jurisdiction.
In a recent case before Orissa High Court it was ruled that surplus electricity supplied free of cost is entitled to Cenvat Credit allowing businesses to benefit from tax relief.
The High Court Bench of Justice Arindam Sinha and Justice M.S. Sahoo that there was no substantial question of law regarding the use of manufactured electricity in one unit of respondent but transmitted for use by another for use in manufacture of dutiable goods, to obtain cenvat credit. Hence Appeal was dismissed.
In a recent ruling, the Delhi High Court directed Goods and Service Tax ( GST ) authorities to reconsider the application cancellation of the petitioner’s GST registration and held that cancellation cannot be withheld due to ongoing assessment proceedings.
The Delhi High Court bench directed the petitioner to consider the application for cancellation of GST registration as the cancellation cannot be withheld due to any assessment proceedings or any proceedings for recovery of any statutory dues from the taxpayers. The Delhi High Court bench consisting of Justice Vibhu Bakhru and Justice Sachin Datta, directed the petitioner to provide the proper officer with an address for future correspondence along with the necessary KYC documents.
In a recent ruling, the Karnataka High Court set aside the assessment order and penalty notices due to the assessing officer’s unwarranted doubts about the genuineness of the transaction, ignoring the society’s submissions.
Therefore, the court set aside the assessment orders and penalty notices related to the assessment, and the matter was returned to the stage of reply to the notice under Section 148-A(b) of the Income Tax Act. All contentions were kept open for reconsideration. The petition of the petitioner was disposed of.
The Delhi High Court held in a recent matter that an Application for the Cancellation of Goods and Services Tax (GST) Registration cannot be withheld by the Revenue Department on the basis of any impending assessment or recovery proceedings against the Applicant applying for cancellation.
In light of the observations, the Delhi High Court proceeded to direct the Respondent Principal Commissioner of Department of Trade & Taxes, Government of NCT of Delhi to consider the application for cancellation of GST Registration reaffirming that the cancellation may not be withheld by the Commissioner citing any impending assessment or recovery proceedings against the Applicant seeking cancellation.
Additionally, the Delhi High Court directed the Petitioner to furnish proper documentation regarding their address and other particulars in order to facilitate the cancellation of their GST registration.
In a recent case before Andhra Pradesh High Court the Patanjali’s liabilities under Value-added Taxes (VAT)/ Goods and Services Tax ( GST ) were nullified following the approval of Resolution Plan by the National Company Law Tribunal’s ( NCLT ).
The High Court Bench of Andhra Pradesh comprising Justice R Raghunandan Rao and Justice Harinath.N allowed both the writ petitions, setting aside the Demand-cum-Adjudication orders issued by Assistant Commissioner, Kakinda and Deputy Commissioner (ST), Vijayawada.
However, since the proceedings had covered the period which would not be affected by orders of the NCLT, Mumbai Bench. It would be open to the Assessing Authorities to issue fresh notice for quantifying the taxes and other dues arising for the period 05.09.2019 to 31.03.2020.
The Rajasthan High Court in a recent ruling held that the writ jurisdiction of the High Court cannot be invoked for challenging GST Show-Cause Notices.
The High Court bench comprising Justice Ganesh Ram Meena and Justice Pankaj Bhandari was of the view that writ jurisdiction cannot be invoked to challenge an SCN as the petitioner has the right to file a reply to the show-cause notice according to the CGST Act and held that any order passed by the authorities is appealable.
The writ petition was dismissed by the High Court, but it was held that the petitioner was free to reply to the notice and that the authorities had to act in accordance with law while dealing with the representations.
In a recent case, the Punjab and Haryana High Court held that instructions and circulars can be issued only for supplementing statutory provisions and set aside Income Tax Order Contrary to Income Tax Act,1961.
In view of the judgement , the division bench of Justice Sanjeev Prakash Sharma and Justice Sanjay Vashisth allowed the writ petition . Further held that the observations and order passed above shall apply mutatis mutandis to the present case. The court set aside the notice issued by the Jurisdictional Assessing Officer under section 148 of the Act and the consequential proceedings.
The Rajasthan High Court recently directed the GST Network ( GSTN ) to immediately allow the petitioner firm to log in on the Goods and Services Tax ( GST ) portal.
The firm, which had successfully migrated from the VAT regime to GST, faced issues when it was denied login access on the GST portal due to the mismatch. Despite resubmitting the correct PAN details and reaching out to various authorities, including the jurisdictional GST officers and the GSTN helpdesk, the petitioner could not resolve the issue, resulting in an inability to file returns and comply with GST obligations since July 2017.
Thus, the Goods and Services Tax Network and GST Authorities were directed to immediately allow the petitioner-Firm to login on the GST portal for completing the process of migration for uploading its returns and to deposit the due tax.
In a significant ruling, the Allahabad High Court has upheld the finding of the Commercial Tax Tribunal holding that “vitamins and minerals pre-mix” are unclassified goods, do not fall under “ores and minerals”, “drugs and medicines” or “chemicals” under Schedule II of the U.P. Value Added Tax Act, 2008.
While dismissing the revision application, the court upheld the decision of the Commercial Tax Tribunal that “vitamins and minerals pre-mix” is an unclassified item under the UPVAT Act.
The Madhya Pradesh High Court in a recent case held upheld the order deleting the addition made under section 68 of the Income Tax Act, 1961 due to lack of substantial question.
The bench held that the present case does not involve any substantial question of law so as to meet the provisions of Section 260(A) for admitting the appeal, the High Court dismissed the Revenue’s appeal.
The Gauhati High Court in a recent case quashed the demand and penalty under Central Goods and service Tax Act ( CGST ), 2017 in absence of element of misstatement and intention to evade payment of service tax . It was held that the fact of wilful misstatement or suppression should specifically be mentioned in the show-cause notice.
Since the Department had not misstated any fact with intent to evade the payment of service tax, the Division Bench of Chief Justice Vijay Bishnoi and Justice Suman Shyam quashed the demand of service tax and penalty as there was no element of misstatement and contravention of Service Tax Rules with the intent to evade payment of Service Tax.
In a recent judgment, the Gauhati High Court quashed Notification No. 56/2023, issued by the Central Board of Indirect Taxes and Customs ( CBIC ) on December 28, 2023, deeming it ultra vires to Section 168A of the Central Goods and Services Tax (CGST) Act, 2017.
After hearing the arguments, the bench of Devashis Baruah ruled that Notification 56/2023 was inconsistent with Section 168A of the CGST Act and could not withstand legal scrutiny. Consequently, any actions based on the notification, including the extension of deadlines for passing orders, were deemed invalid.
The Madhya Pradesh High Court has ruled that the GST authorities cannot invoke penal provisions under the Indian Penal Code ( IPC ) without applying the corresponding penal provisions under the GST Act, 2017. The court added that such abuse of process of law cannot be permitted.
The Madhya Pradesh High Court quashed the FIR and the consequential proceedings against the petitioner, affirming that the GST authorities must adhere to the procedural requirements of the GST Act before initiating prosecution.
In a landmark decision, the Allahabad High Court quashed the detention of goods belonging to M/s Vishal Steel Supplier, which were intercepted by authorities on the grounds that the transportation route deviated from the usual path. The court found that no provision under the Goods and Services Tax ( GST ) law mandates the disclosure of the specific route for transportation, and the detention was based on mere speculation.
The Allahabad High Court Single Bench of Justice Piyush Agrawal cited a prior ruling in M/s Om Prakash Kuldeep Kumar to reinforce that the power to detain and seize can only be exercised if the goods are not accompanied by genuine documents.
The Allahabad High Court ruled in favour of the petitioner, quashing the orders from the tax authorities, and directed the refund of any deposited amount.
The Madras High Court ruled that a taxpayer can challenge the imposition of a penalty under the Goods and Services Tax ( GST ), when the liability is paid. The court directed the GST Department to take an appeal filed solely against the penalty on record, thereby providing relief to the petitioner who had faced rejection of their appeal by the lower authority.
The court thus set aside the intimation dated 07.02.2024, issued by the second respondent, which had rejected the appeal. The court further directed the second respondent to take the appeal on record and proceed to adjudicate the matter on its merits, while ensuring that the petitioner is provided with sufficient opportunity to present their case.
In a recent ruling, the Gujarat High Court quashed a Show Cause Notice (SCN) issued against J.K. Papad Industries, which had demanded an 18% Goods and Services Tax (GST) on the supply of uncooked extruded snack pellets. It was noted that the petitioner had acted in good faith by classifying their product as per the earlier rulings and was entitled to the benefit of the lower 5% rate.
The Gujarat High Court bench of Justice Bhargav D Karia and Justice Niral R Mehta, after reviewing the case, held that the demand for 18% GST was unjustified. It found that the petitioner had acted in good faith by classifying their product as per the earlier rulings and was entitled to the benefit of the lower 5% rate. The court also directed the authorities to regularize the past returns filed by the petitioner at the 5% rate, rejecting the imposition of 18% GST for the prior period.
In a recent ruling, the Karnataka High Court quashed income tax assessment order, ruling that the petitioner had entrusted the case to a Chartered Accountant, who was unable to appear before the Assessing Officer (AO). This absence led to an ex parte order being passed against the petitioner.
The court also recorded the petitioner’s commitment to unconditionally withdraw the appeal and set aside both the Assessment Order and Demand Notice dated March 24, 2023.
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